Land prices still Rising? - Page 3 - The Combine Forum
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post #21 of 167 (permalink) Old 04-24-2018, 12:26 PM
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Is there actually any more money in owning more land? I've been personally debating on what to do about getting extra acres. It feels like most of the extra money goes to paying for the equipment and manpower to farm said land.

I'm starting to think that just doing a better job and/or improving current land is money better spent.
I've come to the same conclusion came home from a land auction for nearly $4000 per acre for marginal land, and had to do a rethink of my strategy. Added up all the acres on the farm which I could put into production with some work( or a lot of work). Trees, marginal wet, potholes, fencelines, junk piles, and was surprised to see that I could add nearly 10% to my crop land, for a small fraction of the cost of buying the equivalent acres. Currently looking for the rest of the toys needed to do it with. Has been an ongoing process, but will make it a priority now. Just bought a fixer upper quarter for much cheaper using the same strategy.

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post #22 of 167 (permalink) Old 04-24-2018, 12:31 PM
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If you listened to everyone who said now is the best time to sell in the past you left anshitload on the table. Now very well may be the time to sell but the canít go higher crowd hadnít been right yet.

If you did the opposite of what the canít go higher crowd said you should be easily retired if you sold out now.

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post #23 of 167 (permalink) Old 04-24-2018, 12:38 PM
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If you listened to everyone who said now is the best time to sell in the past you left anshitload on the table. Now very well may be the time to sell but the canít go higher crowd hadnít been right yet.

If you did the opposite of what the canít go higher crowd said you should be easily retired if you sold out now.
If I had a dollar for every time someone told me land was too high and has to crash, and that interest rates are set to go much higher, I could afford a lot of over priced land.

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post #24 of 167 (permalink) Old 04-24-2018, 12:43 PM Thread Starter
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If you did the opposite of what the canít go higher crowd said you should be easily retired if you sold out now.
If I simply did the math of crop prices vs land prices and assumed most land owned by active farmers, its a slam dunk this is near the top.

But, consider investors in there, possible wall street hedge funds, pension plans and my accountant told me BTOs are using money inside their company to buy land in it. More untaxed leverage than buying privately.

Add in the instability in the world, lack of faith in dollar, debt, QE, etc and then I think its upside is huge. Kind of like the gold guys thinking its going to $10k an ounce.
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post #25 of 167 (permalink) Old 04-24-2018, 12:46 PM Thread Starter
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Part of me thinks there could be a back to the land movement in the future. If jobs become automated and the govt gives you a pittance in supplement income why would you sit in a slum when you could own a quarter, be self sufficient.
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post #26 of 167 (permalink) Old 04-24-2018, 08:48 PM
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It seems to me land, housing and commercial property has pretty much leveled out. Perhaps a few buyers making panic purchases to lock in loans while interest rates start climbing. An interesting purchasing decision if so.

I will bet that if interest rates climb another 3% the entire "investment" dynamic changes. You can purchase anything at any price provided cheap credit is there to drive the bidding frenzy which drives asset prices higher. Remove the cheap credit and you remove the bidding frenzy which, by default, halts the price escalation. And now the "investment" is solely assessed on its earning potential.

Do you buy an asset where the price escalator stopped working or do you move your wealth elsewhere.

But we don't know what comes next. Negative interest rates maybe. Or a buying frenzy to purchase anything tangible as Amazon stock is sold off because people start to think that just maybe a 334:1 P/E may not be a good retirement investment.

Interesting times a head. All dependent on what the bankers do.
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post #27 of 167 (permalink) Old 04-24-2018, 11:54 PM
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When these land price are quoted they never indicate how many acres have traded hands. I am guessing with todays current prices fewer acres are being bought and sold. Land prices are similar to the stock market. When the market is up people only think it will go higher and never go down. Land is like the market and has cyles of ups and downs. When land gets to be $600-700,000 a quarter the return on investment is poor and the risk is high. I can not see the average investor seing that as a good place to put money unless they are a billionaire.
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post #28 of 167 (permalink) Old 04-25-2018, 12:12 AM
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When these land price are quoted they never indicate how many acres have traded hands.
Exactly right. Just because a bit of land traded hands for $XXX does not mean that all land is worth $XXX. It simply means that that is what somebody had to pay to get what happened to be available at the time.

So here we go with assessments and land taxes raging higher, all supported by this ongoing nonsense from the government lender that ALL land is worth $XXX. I mean, why else would they focus so hard on this???
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post #29 of 167 (permalink) Old 04-25-2018, 12:26 AM
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When ever things are happening with a particular stock you want to know what the volume is that is being traded. If there is lots of volume then the price move is more significant. With the FCC they never quote the volume. It seems like they just want to hype it up some more and are not interested in putting any facts behind it.
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post #30 of 167 (permalink) Old 04-25-2018, 07:18 AM
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So not one person is starting out in farming in Canada is not doing it organically (income wise) ...working on the oil patch or another job and buying a small piece ofd land..

WOW...thats sad...

Ant...

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